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Special court issues summons to Vijay Mallya on tax dues; Kingfisher terms it illegal


Beleaguered Kingfisher Airlines, on Thursday, hit out at the Income Tax department for filing a criminal case demanding Rs 74.94 crore as tax deducted at source from salaries of its employees, terming it as 'infructuous' and illegal.

"The case filed by the Income Tax department is infructuous and needs to be withdrawn. The demand of Rs 74.94 crore, being the TDS on salaries, has already been paid by the company to the tax authorities," Kingfisher said in a statement after the Special Court for Economic Offences issued summons to Vijay Mallya, promoter of Kingfisher Airlines.


"The Rs 74.94 crore TDS dues demand was set aside by the Income Tax Appellate Tribunal, Karnataka and it is the company's considered view that currently no demand exists," the statement further said.


Moreover, it added, the company had approached the Supreme Court with a special leave petition and the hearing is slated for March 8.


The court's action came after it took cognisance of the offence under sections 276B and 278B of the I-T Act, 1962, for not remitting Rs 74.94 crore deducted as TDS in 2009-10 fiscal and Rs 23.70 crore imposed as interest for not meeting the deadline stipulated for payment.


Section 276B entails rigorous imprisonment for a minimum of three months and a maximum of seven years with fine.


The development spells fresh trouble for Mr Mallya, whose airline is tottering with a net loss of Rs 755.17 crore for the third quarter ended December 31, 2012, a period when it did not operate a single flight.


I-T officials on Tuesday had filed the criminal complaint against the airline and Mr Mallya for failure to remit TDS for the fiscal 2009-10.


The I-T Department had also complained that Kingfisher owed the government Rs 401 crore as TDS amount, deducted from salaries of its employees and from payments made to others in the financial years 2008-2012.


Carrying a debt of nearly Rs 8,000 crore and accumulated loss and liabilities of a similar amount, Kingfisher has been grounded since October 1 last year after its pilots and engineers went on a strike over non-payment of salaries. 


With inputs from PTI

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